The United States, typically known for its welcoming stance toward technology, is considering tightening regulations on Web3 and blockchain technologies.
This shift in focus presents the UK with a new opportunity to attract billions of dollars in investment, according to analysis by Iain Mansfield.
Within the fintech space, there is a promising £10bn opportunity for British businesses, provided regulatory measures are carefully crafted. A recently published report by Policy Exchange emphasizes that, given the increasingly strict regulatory environment in the United States, the United Kingdom has a unique opportunity to capture a larger share of this burgeoning market.
Historically, the City of London has been at the forefront of financial innovation. He has played a pivotal role in shaping the modern business landscape, from the development of contemporary business structure to Lloyd’s Coffee House’s innovative initiatives in the insurance sector. Even the British victory over Napoleon can be attributed in part to London’s financial sector, which facilitated the government’s ability to raise funds. The financial revolution of the 1980s, often called the Big Bang, revitalized the City’s position, and a 2021 study ranked London as the second most innovative city in the world.
One particularly promising area is Web3, a decentralized blockchain-based technology that has the potential to transform our use of the Internet. While the sector initially faced challenges due to its association with speculative “casino capitalism,” technology companies are now rapidly developing innovative products with important real-world applications.
Well-established companies such as PayPal, JP Morgan and Nike have joined the blockchain field, while Web3 technology has proven its versatility by helping people in Ukraine, facilitating affordable remittances for the unbanked in developing countries, digitizing driver’s licenses in California and allow payments. for carbon credits in India.
Traditionally, the United States has been a pioneer in this sector. However, a challenging environment is emerging in California that is causing American companies to look across the Atlantic for opportunities. Rising regulatory hurdles and a growing sense of uncertainty are driving Web3 companies to set up branches outside the U.S., with some even closing operations in the country. A recent survey revealed that 12 percent of crypto hedge funds are contemplating relocating from the US to jurisdictions that offer a more balanced regulatory framework.
The UK, recognized as a global fintech hub, is becoming increasingly attractive to investors. Its regulatory approach, characterized by a “same risk, same regulatory outcome” philosophy, is attracting attention. With a whopping £77 billion invested globally in blockchain startups, a conservative estimate suggests the UK could easily secure new assets worth £10.7 billion, supporting the creation of 36,000 jobs in the process.
The Prime Minister has been quite clear about his vision for Web3. During his tenure as Chancellor, he expressed his ambition to position the UK as a global crypto asset technology hub, with the aim of attracting jobs to the country. Crucially, he emphasized that effective regulation could instil confidence among investors, encouraging long-term commitment. As a result, we have witnessed the opening of London branches of several major American companies.
Now, it is essential that regulators like the FCA and others follow through on this vision.
While concepts like digital wallets, stablecoins, and tokens may seem unfamiliar to consumers today, with the right regulatory framework they could become as common and easy to use as banking apps and social media platforms.
Furthermore, our public services should be prepared to harness the potential of Web3 and other emerging technologies such as AI. These innovations are on the horizon and it is imperative that the UK, particularly London, takes a leading role in their development and implementation.
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Categories: Technology
Source: vtt.edu.vn